New Delhi: India, the world’s largest milk producer, is likely to import skimmed milk power (SMP) in the coming weeks to contain price rise and shortage of the product in the domestic market.
“The National Dairy Development Board has been advised to work out a contingency plan to import SMP under the Tariff Rate Quota (TRQ) if the situation so warrants in the coming weeks,” minister of state for agriculture K V Thomas said in a written reply in the Lok Sabha on Tuesday.
Milk production at national level is by and large sufficient to meet the domestic consumption of milk and milk products. In case of acute shortage, import of milk powder at five per cent import duty for up to a quantity of 10,000 tonnes under TRQ is permitted to ensure supply of the product, he said.
Admitting that the domestic price of SMP is higher than the international market, the minister said that the rise in price is only a “seasonal development”.
Prices of milk powder in the country generally tends to increase during summer as the production and procurement of milk goes down due to heat stress of milch animals. In Oceania, Western Europe and the US, SMP prices depend on the cost of milk production and export subsidy provided by the respective governments, he explained.
The price of milk powder in India is ruling at Rs140 a kg in July, compared with Rs 97 a kg in the US and Oceania and Rs114 a kg in Western Europe, he said, adding that lower production and procurement effect the cost of production and also the sale price of milk power.
”Increased demand coupled with lower milk powder production during summer season is weighing on prices. However, there is no shortage of milk to produce SMP in the country and there is no necessity to import the product,“ according to Delhi-based diary expert R S Khanna.
Milk production stood at 10.48 crore tonnes during 2007-08.